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Full text of "Means to promote co-operation between railroad managements and employees [microform]"

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Author: 



Hunt, Henry T. 



Title: 



Means to promote 
co-operation between 

Place: 

.p.] 

Date: 

1922 




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Hunt, Henry T 

Means to promote co-operation between rail- 
road, managements and employees, 1922. 

46 p. 




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MEANS TO PROMOTE CO-OPERATION 
TWEEN RAILROA D MANAGEMENTS 
AND EMPLOYEES 



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By 
HENRY T. HUNT 

Late Member Railroad Labor Board 
807 Pershing Sq. Bldg. 






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June 20th, 1922 



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MEANS TO PROMOTE CO-OPERATION 

BETWEEN RAILROAD MANAGE- 

MENTS AND EMPLOYEES 



CO-OPERATIVE SPIRIT ESSENTIAL TO SOLU- 
TION OF RAILROAD PROBLEM 

The problem of management is so to direct the 
combination of plant and person constituting 
the railroad that it may serve economically and 
adequately the public's railroad transportation 
needs. The method of solution hitherto applied 
has been mechanical. It has concerned itself al- 
most solely with processes, appliances and fi- 
nance. The factor in the combination which is 
alive and responsive, the personnel, has been neg- 
lected. If the problem is to be solved by rail- 
read managements; if the ))ublic is to be eco- 
nomically and adequately served, the manage- 
ment's attention must be concentrated on the two 
million men Avho in fact move the railroad com- 
merce of the country. It is by furthering their 
devotion to the service that management and men 
may attain higher satisfaction, the investor may 
be provided for and the public need may be met. 
The desire to co-operate must be substituted for 
' the distrust, hostility and consequent friction 
which now marks the interaction of the two liv- 
ing parts of the combination, the management 
and the personnel, called employees, but in a true 
conception of the relationship, partners. 



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AVENUES TO GREATER SELF REALIZATION 
FOR EMPLOYEES MUST BE PROVIDED 

Mechanics and finance have preempted the 
minds of railroad management long enough. 
Psychology and the technique of industrial poli- 
tics must now have attention. The two million 
men, who move the railroad commerce of the 
country are not two million machines. Their 
zest in applying their minds and muscles to the 
railroad plant determines how cheaply, safely and 
speedily commerce moves. They do not respond 
to the application of power. They are individ- 
uals controlled by complex instincts and desires 
which determine what ]>ortion of his mental and 
physical energy- each will apply to the job. Each 
applies, over the minimum necessary to hold it, 
energy in proportion to the satisfaction he finds 
in the work and its surroundings. The great 
mass find their satisfaction unnecessarily meager. 
Satisfaction is not made u]> of fair wages only. 
Men desire also self-expression, the fulfillment of 
the creative instinct, food for self-respect; recog- 
nition of workmanlike abilities. There are social 
longings also; the wish to be directed by admired 
men, the wish to be surrounded by congenial as- 
sociates. They demand above all what may be 
called political rights in industry, the right to 
participate in decisions aft'ecting their welfare, 
the right to participate in management to the ex- 
tent of their ability. By the possession of this 
right and its exercise the other desires stated 
may be best fulfilled. These very human and 
natural desires, it is believed, are not adequately 
realized by railroad managements. Denial of 
outlet for them leads to the suppression of in- 



tellectual and physical energies which it would be 
agreeable to apply to work, or diverts tliein to 
destructive objectives. Energies will be released, 
will be made available for the increase of pro- 
duction and thus become seiTiceable to societv 
in proportion as these wishes are fulfilled. To 
secure co-operation from railroad employees ave- 
nues must be opened which afford opportunity for 
such satisfaction. 

PRESENT OPPORTUNITIES FOR SELP-EXPRES- 

SION 

A survey of the railroad service shows rjnl- 
road managers not yet grasping and applying to 
its full meaning the fact that railroad workmen 
are 100% men. Financial and mechanical ])rob- 
lems have forced themselves continuously on 
managerial attention and have jostled human re- 
lations into the backgrounds. It might have been 
supposed that the transportation industiy which 
is officered and manned in great ])art by native 
born Americans belonging to a race trained for 
generations in self government would have been 
the first to develop and apply ])olitical machinery 
to industry. However, little or nothing has been 
done. Some benefits, such as pensions, insur- 
ance, have been handed down from above in an 
effort to purchase loyalty, but nothing real and 
substantial to develop and utilize by self exercise 
the reserves of capacity and energy i)ossessed by 
railroad employees. The result of the omission 
has been to evoke the determination of railroad 
employees to force their recognition as dangerous 
combatants, if not as men worthy of co-operation. 
Their powers have thus been diverted from con- 
structive to destructive uses. 



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EVEN MATERIAL INCENSES FOR CCOPERA- 

TION LACKING 

What incentive have railroad employees to ex- 
ert themselves physicially or intellectually be- 
yond a jobholding minimum? With the creative 
desire comes the chilling thought that such ex- 
ertion will benefit only the remote stockholders. 
To be a part of a prosperous enteri>i-ise is some 
satisfaction and prosperity enables the manage- 
ment to maintain way and e(iuipment in first-class 
condition, to provide first-class service and so 
promotes safety and regulanty of employment. 
Yet these benefits are too remote to constitute uu 
incentive to individual workmen. Extra effort 
will not raise wages or improve working condi- 
tions They are standard and have no relation 
to profits. On the employee's estimate of proba- 
bilities the hope of promotion perhaps influences 
one out of ten. The effectiveness of this incen- 
tive is reduced by the desire to be loyal to one s 
associates. Loyalty involves not showing up the 
slow. The appearance of currying favor with the 
companv at their expense must also be avoided. 
There is now little material incentive for phy- 
sical or mental co-operation beyond the minimum. 

EFFECT OF OLD AND PRESENT CONFLICTS 
^ ON CO-OPERATIVE SPIRIT 

There is not only a lack of available oppor- 
tunity for self-expression in the railroad service, 
denial of full recognition of employees as men 
and a lack of material incentives, but ancient 
grudges and present conflicts also tend to stifle 
the co-operative spirit. 



There has long been conflict between the man- 
agement's desire to earn dividends or interest 
and the employee's desire for high wages. Each 
side accordingly is organized for defense and of- 
fense; the men into national and international 
unions, the managements into associations of 
executives and banking groups controlling rail- 
roads. The employees' organizations strive to 
raise wages and they have found the possession 
of economic power (the ability to call an effective 
strike) a potent argument. The executives* as- 
sociations and banking groups try to hold wages 
down, often it would seem without due regard to 
the justice of the demands. Reprisal and counter 
reprisal have followed. The conflict as to wages 
has thus come to color to the relationship. 

THE RELATION NOT IN PACT HOSTILE 

A more accurate conception by both sides of 
the true nature of the relationship as something 
in the nature of a partnership, will help to traus^- 
form the spirit of combat into one of joint action 
to realize joint interest. To determine to what 
extent the relation is hostile and to what extent 
the interests of management and employees are 
substantially identical and stronger co-operation 
may be intelligent, it should be considered how 
far those interests go along with each other and 
where they conflict. The paths of common inter- 
est and the points of collision can be mapped out 
and fixed by tracing what the management seeks 
and what the men strive for and need. 

OBJECTIVES OP MANAGEMENTS 

The primary objective of railroad management 
is so to utilize and direct the combination of plant 



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6 

and personnel under its control as to serve ade- 
(luately the railroad transportation needs ot the 
public within its field. 

The second objective is so to direct as to bene- 
fit stockholders. 

OBJECTIVES OF MEN 

Each employee strives for: 

1. Economic security; earninos sufficient to 
maintain a reasonable standard of livinp:. 

2 Fair working conditions. 

3. (a). Recognition as a hundred per cent 
twentieth century man convinced of his birth 
right to citizenship in industry. This includes 
recognition of his obligations as well as the as- 
sertion of rights, responsibility for production 
as well as participation for self-interest in de- 
cisions (b) Opportunity to exercise the creative 
instinct in his work, (c) Consciousness of selt- 
respect; he wishes to be conscious of recognition 
as a technician of value both by the management 
and his associates, (d) The fulfillment of social 
desires, the desire to be ably led, to admire a 
leader, to be regarded with approval in all re- 
spects bv associates. 

The most consciously held and most strongly 
asserted objective of this category is the desire 
to be at least consulted on decisions affecting his 

welfare. 

INTERESTS OF THE PARTIES, EXCEPT IN PART 
AS TO WAGE RATES NOT CONFLICTING 

The fulfillment of these desires is in general 
consistent with the objectives of managements. 
In fact not onlv is their interest not diverse, but 






process toward the attainment of the persou- 
nePs desires will aid the attainment of the man- 
agement's objectives. 

FUNCTION OP FIXING WAGE RATES, FORMER- 
LY PRINCIPAL BASIS OP CONFLICT, NOW 
REMOVED TO LABOR BOARD 

Kailroad managers are apparently proceeding 
in pursuance of a common policy to standardize 
wage rates in the same "region. '^ They wish 
this standard to be the maximum. The railroad 
labor org-anizations strive to establish a standard 
as a minimum. Perhaps certain railroads would 
build up a more efficient force by agreeing with 
their own employees on higher than standard 
rates. But experience has convinced manaae- 
ments that competition for workmen through 
wage rates is injurious. The railroad labor or- 
ganizations hold their membershij) to tho policy 
that wage rates determined by the Labor Board 
be the minimum. The managements have found 
that a concession in wage rates to any class of 
employees had led to demands from the rest, also 
that a concession has led to agitation for similar 
action on other railroads where like conditions 
do not prevail. 

Railroad managers and organizations of em- 
ployees for these among other reasons will not 
agree in conference. Wage rates are thereupon 
fixed by the Railroad Labor Board and this re- 
sponsibility has thus been removed from manage- 
ments. 



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8 

THE RESIDUE OP FACTORS OP RELATION 

LEND THEMSELVES TO CO-OPERATION 

ARRIVED AT BY CONPERENCE 

With wage rates practically no longer a sub- 
ject matter of conflict between particular rail- 
roads and its employees it would seem that the 
residue of the factors of the relation and the rea- 
sonable attainment by each party of its desires 
are not in conflict but helpful to the other. It 
is certainly in the interest of the management to 
further the men's wishes. An organization's 
productivity increases with faith in the manage- 
ment's good wishes and good deeds toward it. 
There is a best method by which to agree on what 
interests are joined and one method to agree also 
on means to promote them. This method is by 
conference. Possibly the paramount subject mat- 
ter for such conference helpful to both sides is 
continuity of employment. 

CONTINUITY OP EMPLOYMENT BENEFICIAL 

TO ALL PARTIES 

While wage rates must be standard, a railroad 
company may increase its employees' earnings 
with benefit to itself and thus promote in their 
minds realization of joint interest. Improving 
continuity of employment will accomplish this. 

Wages (earnings) are made up of rates per 
hour multiplied by time worked. Time worked 
lies in part within the control of the manage- 
ment. While fluctuating traffic, weather and 
other causes beyond control affect time worked 
and therefore earnings, earnings are also affected 
by the management's employment policy and by 
its prevision in budget formulation. In the bud- 



9 



get apportionment the return to the property of 
a stabilized force, integrated by a consciousness 
of appreciation and by the experience in team- 
work is often sacrificed to less lucrative objec- 
tives. The directors and executives are usually 
not in touch v\ith the men and being remote think 
of them as mere mechanism to be set in motion 
or stopped as other power is applied or with- 
drawn. Regular conferences with representa- 
tives of employees would cure this false and 
morale killing conception. 

WASTE IN LAY-OFFS 

Forces regularly at work attain higher effici- 
ency than forces disorganized by law-offs. These 
lay-offs occur in some branches because there is no 
work and in others (way and equipment) because 
although there is work, there is no money to pay 
for it. Usually the work is performed later in 
haste and in part at over-time rates. This is 
])artieularly the case in maintenance of equip- 
ment. Laying off men by reason of temporary 
lack of funds is not thrift but waste. Morale is 
reduced, team-work impaired, expense increased 
by reason of later over-time and by the failure 
to have equipment in condition to handle traffic 
when it returns to normal volume. Railroad man- 
agers doubtless are aware of this and do trv 
rather feebly it appears to prevent lay-offs. Their 
interest is, however, much less than that of the 
employees concerned. Stoppage of income to a 
wage earner for even a month or two is a tragedy. 
His savings are soon exhausted, his family's stand- 
ard of living lowered below the danger point, 
debt and humiliation follow, and as these mis- 
fortunes are not his fault he feels strong resent- 



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ment against the management which he holds re- 
sponsible. His lac*k of knowledge for the reasons 
for the lav-otf increases his bitterness. If he could 
be convinced of its necessity, he would feel less 
outraged. Conferences between his representa- 
tives and the management's to find means to reduce 
these lay-offs and keep him informed of the rea- 
sons for them when necessary would aid co-op- 
eration. 

CONFERENCES WOULD AID REDUCTION OF 

THIS WASTE 

Managements could increase the apprecition 
of identity of interest and thus the incentive to 
co-operation by instituting such conferences, 
keeping the situation before them, and endeavor- 
ing to work out with them means to reduce lay- 
offs to the lowest possible minimum. Action 
could be arrived at in conference which would 
tend to stabilize employment and methods de- 
veloped to keep employees informed of the rea- 
sons for lay-offs in a manner which would com- 
mand their confidence. 

RECOGNITION BY MANAGEMENT OF WORK- 
MEN'S DESIRE FOR SELF-EXPRESSION 

Recognition of the employee's interest in his 
job and of his intelligence, such as conference 
with his representatives carries, would aid the co- 
operative spirit far more than hauded-down bene- 
fits. Agreement admitting the employees' quali- 
fications as a twentieth century man and work- 
man, and providing avenues for his self-expres- 
sion to the extent reasonably practicable, would 
be the fruitful mother of co-operation. Such 
agreements should establish legular contacts by 



11 



NUieans of representatives not only to adjust 
grievances as now but to determine how far in- 
terests are joint, and to work jointly toward 
joint interest; specificially, to prevent unemploy- 
ment, reduce waste, promote productivity and 
endeavor to make life in its working aspects more 
satisfying. 

UTILIZATION OF PRESENT MACHINERY FOR 

CONTACT 

There are now contracts to adjust grievances 
provided for in existing agreements which have 
been arrived at usually after war or threat of 
war. This armistice origin colors their opera- 
tion. Gradually, however, even these conferences 
have become less and less pugnacious. Modera- 
tion and reasonableness on both sides grow with 
the interchange of views despite the fact that 
meetings take place only when definite contro- 
versies have been permitted to arise on which 
each side has taken a set position. It is then 
difficult for either to recede without an appear- 
ance of weakness or inconsistencv. Furthermore, 
these conferences are for adjustment of grievances 
only. If the conferences were regular and their 
purposes included ascertainment of joint interest 
and means to promote it, reduction of waste and 
increase of production, removal of causes of 
grievance before they could become subject of 
controversy, they would still more effectively aid 
good relations. Mere sluggish peace would be 
displaced by a lively spirit of vigorous, healthy 
and intelligence satisfying co-operation. 



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ADDING CO-OPERATIVE FUNCTIONS TO 
GRIEVANCE COMMITTEEMEN 

Xo adequate reason appears why grievance 
committeemen should not become also committee- 
men on co-operation, thus undertaking a function 
Avhich includes adjustment of grievances. 

There are advantages in utilizing existing ma- 
chinery over building up something new and elab- 
orate. Using the old makes for simplicity. It 
requires no great mental leap for railroad em- 
ployees to conceive of a committee formerly con- 
cerned with the promotion of better relations by 
the removal of grievances now concerned also 
with the promotion of better relations by action 
toward joint interest of all kinds. Furthermore 
the utilization of personnel already in this field 
would commend the plan to employees. These 
committeemen have won their position because 
they possess leadership. They are trusted. They 
are trained also in a part of the technique nec- 
essary to work out means of promoting joint in- 
terest. They have acquired a fairly wide view 
of the railroad business; know more than other 
workmen about men and managements. The ex- 
isting committees are part of the machinery of 
the employees' organizations. Members know of 
them, know the committeemen and are in the 
habit of consulting these committeemen on ap- 
propriate subjects. The serving committeemen 
if won to the plan of co-operation would inter- 
pret it to their members, popularize it and as- 
sist in making it function. To create additional 
committees with new personnel would tend to 
confuse the employees, arouse the jealousy and 
opposition of the present committeemen and 
olfers few compensating advantages. 



13 



GRIEVANCE COMMITTEEMEN CO-OPERATIVE 
COMMITTEEMEN ALSO 

If organization rules could be easily changed 
it would be simplest to attach co-operative func- 
tions to grievance committees. But to amend 
these rules is a complicated process. To agree 
without preliminary with the organizations that 
grievance committees should hereafter exercise 
co-operative functions would infringe somewhat 
upon the non-union employees' right to express 
themselves on this subject. This infringement 
would be more apparent than real as railroad em- 
ployees are ninety per cent organized; yet to 
avoid even the appearance of unfairness it would 
be well to provide non-union employees an oppor- 
tunity to vote for whom they please as co- 
operative committeemen. An election vrould also 
provide opportunity for education in the plan 
and would arouse great interest. Xo reason ex- 
ists why the members of the grievance committee 
should not be nominated by the labor organiza- 
tions as members of the committee on co-opera- 
tion. The co-operative committee should be de- 
signed to have as nmny members representing the 
men as the total membership of the grievance 
committees. 

The development of grievance committees into 
co-operative committees throughout the railroad 
service would seem to be consistent with the logic 
of the situation. If both parties could be brought 
to agree to the enlargement of function, new char- 
acter and name, a happier and healthier era 
would be entered upon. 



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MAINTENANCE OP EQUIPMENT DEPARTMENT 
BEST GROUND TO BEGIN ON 

In the maintenance of equipment department 
conditions are peculiarly favorable for the es- 
tablishment of co-operative committees. Shop 
committees in outside industries have been suc- 
cessful in promotiniTj the co-operative spirit. In 
a number of such industries conditions are simi- 
lar to those in railroad shops. Railroad shops 
are engaged on repair work in the main and out- 
side industries on new work. This ditt'erence 
makes a complication which must be reckoned 
with, but it is insufficient to prevent successful 
functioning of railroad shop committees. The 
preponderance of considerations demand their 
establishment. 

AGREEMENT WITH EMPLOYEES' ORGANIZA- 
TIONS BEST PROCEDURE FOR ESTABLISHING 

SHOP COMMITTEES 

The advisability of developing shop committee- 
men out of existing grievance committeemen, or 
otherwise establishing shop committees should be 
lirst discussed with the general officers of the 
shop craft organizations. If they agree a plan 
should be worked out with the system representa- 
tives of these organizations. Probably a particu- 
lar shop where conditions are deemed favorable 
should be selected as a starting point. 

VALUE OF SHOP COMMITTEES 

The establishment of shop committees by agree- 
ment would promote the co-operative spirit. 
What workmen and manngersj both seek would be 
brought nearer. 



15 



Earnings of regular employees would tend to 
increase. The committee in the joint interest 
would strive to stabilize the force and make 
employment continuous. 

Productivity would increase and working con- 
ditions, improve as discussion ascertained joint 
interest and ways and means, and joint action 
realized them. 

The desire of employees for recognition as men 
would be in the way of being gratified. They 
would possess an avenue for the expression of 
their desires as men, as craftsmen and as em- 
ployees. 

Matthew Woll, Vice-President of the American 
Federation of Labor, has well stated why regu- 
lar conferences in a co-operative spirit would aid 
production. 

"There is always a best way to do things— a 
better way of approaching and administering 
labor problems of production. Experience has 
demonstrated that the better way is by and 
through the exchange of information, experience 
and co-operation between employers and em- 
ployees collectively. The workers usually possess 
knowledge of production totally outside the ex- 
perience of employers. Their practical industrial 
training and experience develop knowledge they 
alone can possess. Industrial and business man- 
agers to acquire knowledge and develop an un- 
derstanding totally outside of the experience and 
knowledge of the employees. Where there is an 
absence of a mutual understanding upon these 
different branches of business and industry there 
is a fullness of opportunity for misunderstand- 
ing, confusion and friction. It is imperative that 



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an interchange of information, experience and 
purposes of plans should be provided between 
employers and workers for their mutual and in- 
telligent guidance, if a maximum of production 
is to be obtained with a minimum of confusion, 
waste and friction. This can only be accom- 
plished through collective principles and pro- 
cedure'^ ("Annals'', Philadelphia Nov. 1920). 

EMPLOYEE MEMBERSHIP OF JOINT SHOP 

COMMITTEE 

The shop committee might be established either 
upon crafts or upon shop departments or upon 
a combination. 

If by crafts, it might be made up of represent- 
atives of each craft, the grievance committees be- 
ing developed into the shop committee or other- 
wise as the conference on the subject may decide. 

If the departmental plan is deemed expedient, 
each department would elect committeemen. 

The craft plan would have the advantage of 
being in line with the organization set up. It is 
essential to success that the plan secure the sup- 
port of the shop craft organizations in shops 
where these organizations include the majority of 
the workers. 

The plan of organization and procedure of the 
shop committee would be decided by the confer- 
ence on the subject, between the system repre- 
sentatives of the shop crafts and the management. 

EMPLOYER MEMBERSHIP 

It would seem to be highly advantageous if not 
necessai*y to success, particularly at the outset, 
that there be direct contact between the shop 



superintendent and the employees' committee- 
men, also preferably at the outset the transmuted 
grievance committeemen. To improve the quality 
and continuity of the contact afforded by the con- 
ferences representatives of the principal opera- 
tions of the shop in the persons of the heads of 
department should be made members of the joint 
committee in numbers equal to and not to exceed 
the employees' representatives. 

GENERAL FUNCTIONS OF JOINT SHOP 

COMMITTEES 

The general functions of the shop committees 
would be to promote: 

1. Better understanding by management of the 
needs, desires and problems of workmen, and by 
workmen of the objects and problems of manage- 
ment. 

2. Stabilization of forces, reduction of unem- 
ployment and measures to reduce the injury to 
workmen caused by unemployment. Unemploy- 
ment insurance. 

3. The growth of faith, confidence and trust on 
both sides. 

4. Ascertainment of and agreement upon a fair 
output. 

5. Increase of production by elimination of 
waste and improvement of processes. 

6. Elimination of causes of grievance and set- 
tlement of grievances. 

The last named subject should be handled by a 
sub-committee composed of representatives of 
each side. 



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18 



SHOP COMMITTEE AS MEANS OP INCREASING 
PRODUCTIVITY OF SHOP AS A UNIT: APPLICA- 
TION OF PART OF VALUE TO UNEMPLOY- 
MENT INSURANCE FUND 

A plan whereby the value of increased pro- 
ductivity might ])e applied to an unemployment 
insurance fund or other insurance fund might be 
worked out through the committee. The problem 
of agreeing with representatives of employees 
upon a minimum individual task in repair work 
such as is done in railroad shops, is difficult. 
Piece work in shops is opposed by the organiza- 
tions for reasons which have considerable weight. 

Yet a shop committee might agree with the shop 
on a minimum output for the shop for a period 
as a standard of productivity. Productivity 
above this would be super-productivity, the value 
of which might be ascertained and a i)art agreed 
upon paid by the company into an unemployment 
insurance or other insurance fund. 

For example, a study might be made of the out- 
put (cars and locomotives repaired) in a shop 
during a term of years and the average calcu- 
lated, say, for one year. An agreement could be 
made through the shop committee that an extra 
amount based on production beyond this average, 
say half its value during a year, would be paid 
into an insurance fund and credited to each craft 
in proportion to the aggregate of wages earned 
by the craft in that shop. A formula to ascer- 
tain the value of this super-productivity could be 
arrived at by agreement. Each craft and each 
individual in the craft would then have an incen- 
tive to co-operate. 



19 



PROVISIOXS OF THE AGREEMENT NECESSARY FOR 
PROTECTION OF THE PARTIES 

Provision could be made in the agreement for 
ascertainment of that part of increased pro- 
ductively attributable to new machinery but it 
would be simpler and less provocative of dis- 
agreement if new machinery could be installed 
prior to the time the agreement goes into effect 
or is renew^ed. 

INSPECTION OF RECORDS 

It would be necessary to provide that the em- 
ployees' right to inspect the records be protected. 

EFFECT OF SHUT-DOWNS 

Shut-downs or lay-offs must not, of course, af- 
fect the reward for super-production already 
earned. Probably it could be ascertained and 
paid into the insurance fund at shorter periods 
than one year. The shorter the period within 
reason the more effective the incentive. 

PENALTY FOR SHUT-DOWNS 

An effective and fair penalty against the com- 
pany for shut-downs or lay-offs would be that the 
company should pay to the fund the amount 
which would have been credited to it had pro- 
duction continued for the full term at the rate of 
the last normal month. 

The agreement should include the following 
provisions : 

It should be agreed: (1) That the company will 
allot sufficient w^ork to the shop to keep it occu- 



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pied during the working hours and days of the 
period agreed to. The allotment should be ade- 
quate to occupy the stabilized force. (2) That 
the appropriation for labor will be a fair estimate 
of the labor cost of the work allotted. (3) That 
the appropriation for labor will not be drawn up- 
on for other purposes. (4) That necessary sup- 
plies will be furnished as needed. 

Productivity depends in part upon other fac- 
tors, e, g., the competency of superintendents and 
foremen; co-ordination; correct routing; main- 
tenance of tools, etc. No agreement could be 
made unless the representatives of the employees 
believe the superintendent and foreman compe- 
tent. The building up of an unemployment in- 
surance fund in the manner suggested is practi- 
cable probably only after the successful opera- 
tion of the shop committee plan for some time. 

JURISDICTION OF COMMITTEES AND THEIR 

PROCEDURE 

The general jurisdiction of shop committees 
would be the ascertainment of joint interest and 
action to further it. 

The meetings of the joint committee with the 
shop superintendent should be held at the time 
he plans his expenditures for the ensuing month, 
if that is the planning period. The employee 
committeemen should be given adequate oppor- 
tunity to understand the situation and to discuss 
it among themselves. Means to familiarize them- 
selves with operating methods (schedule making, 
etc.) should be afforded. If the proposals of em- 
ployee committeemen cannot be followed, the sup- 
erintendent should spare no pains to explain the 
reasons. 



21 



The number of joint sub-committees and their 
functions is a matter for agreement. Such sub- 
committees in each main department might be 
provided for, composed of representatives of each 
party. By the use of this machinery routine 
matters capable of local handling in the depart- 
ment would not encumber the joint committee 
meetings, but would be handled directly by the 
joint sub-committees. 

IF JOINT SHOP COMMITTEES SUCCESSFUL IN 
ONE SHOP, COULD BE EXTENDED 

If shop committees work successfully in one 
shop they could be extended to other jhops and a 
system committee established which would meet 
with the superintendent of equipment or other 
general officer. Finally adequate machinery 
might be devised to enable the shop employees to 
participate by representatives in the formulation 
of the maintenance of equipment budget. 

CONFERENCE IN CO-OPERATIVE SPIRIT 
VALUABLE THROUGHOUT THE SERVICE 

TRANSPORTATION 

The department of transportation also offers 
opportunity for the ascertainment of joint inter- 
ests and their furtherance through committees by 
stabilization of forces and otherwise. Here there 
is a field for closer co-operation with men in other 
branches of the service. Possibly a plan could be 
worked out for occasional conferences between 
representatives of employees in several branches 
and the management. There seem to be jealousies 
between train service employees and other which 
cannot fail to injure economy of operation. 






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The forces in the transportation department 
must be enlarged and reduced as traffic fluctuates. 
There are available means of stabilizing traffic, 
but these means involve the co-operation of agen- 
cies outside the railroad world. Joint action to 
secure such co-operation arrived at by confer- 
ences of joint committees might well further joint 
interest in this direction. The employees could 
secure assistance not available to the manage- 
ments. The* stabilization of traffic is a subject 
well worthy of the best minds in the railroad 
service. 

MAINTENANCE OF WAY 

In the maintenance of way department regu- 
larity of work is affected by the weather as well 
as by finances. This work is seasonal also. Ef- 
forts to reduce irregularity of employment and 
other waste by the establishment of a system of 
joint conferences between representatives would 
promote joint interest. 

CLERICAI. FORCES 

The clerical forces, except freight handlers, are 
less subject to the vicissitudes of unemployment, 
and co-operative action apparently less promis- 
ing. A study should be made of the possibilities 
herein. 

INSURANCE AT JOINT EXPENSE SUBJECT 
MATTER FOR CONFERENCES 

A large number of industrial and banking cor- 
porations and at least one railroad, assist in pro- 
viding insurance for their employees against 



23 

death and the loss of earning power by reason of 
accident, disease or unemployment. Several in- 
surance companies offer this class of insurance 
(except unemployment) at low rates, made pos- 
sible through the grouping of a large number of 
risks. Among these are the Metropolitan Life, 
Equitable, and Prudential. 

PARAMOUNT IMPORTANCE OF UNEMPLOYMENT 

INSURANCE 

Economic security is among the strongest de- 
sires of railroad employees. 

The minds of wage earners are more or less 
occupied by fears which divert their attention 
from their work to themselves, inhibit construc- 
tive processes of the mind and impair content 
and productivity. 

Among these fears unemployment, debt and the 
sinking of the family into destitution is most 
poignant. 

Saving is preached but is difficult, indeed al- 
most impossible on the budgets of large classes 
without reducing the standard of living below the 
danger point. 

This fear not only destroys constructive ideas 
which might be applied to the improvement of 
processes but it also is the cause of the practice 
of ca-canny. Men are fearful of working them- 
selves out of a job. 

As management is responsible for employing 
men and for providing work, when unemployment 
occurs the management is blamed. Hostility is 
thus created. 









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COMPLETE STABILIZATION NOT REALIZABLE 

Kailroad traffic is variable and its variations 
affect the amount of work and hence the workers 
necessarj^ particularly in the transportation de- 
partment. 

MANY CLASSES OF WORK ARE SEASONAL 

Work is dependent also upon the possession of 
money to pay for it. When revenue is insuffi- 
cient, no surplus available and credit not to be 
had no reasonable terms, men must be laid off to 
make expense balance income. Estimates of in- 
come often prove erroneous by reason of unfore- 
seen traffic depressions, hence programs under- 
taken cannot be carried out and men engaged 
with every intention, to afford permanent em- 
ployment must be furloughed or dismissed. 

Complete stabilization accordingly may not be 
realized. Unemployment to some extent will ex- 
ist in spite of every effort to prevent it. 

VALUE OP UNEMPLOYMENT INSURANCE TO ALL 

PARTIES 

Means exist to reduce the fear of what unem- 
ployment must occur with reference to certain 
classes at least of railroad employees. A fund 
may be built up during employment sufficient to 
aid materially in tiding employees over periods 
of enforced idleness. 

The benefits to the management of such insur- 
ance will amply repay it for sharing the cost. 

These advantages are : 

1. Recognition by employees of the manage- 
ment's interest in their welfare; impelling the de- 
sire to make rturn. 



25 



2. Greater concentration on work and on the 
improvement of processes, less anxiety, less de- 
structive fears, larger release of mental and phys- 
ical energies now suppressed, hence greater pro- 
ductivity. 

COST 

The cost depends upon the duration of unem- 
ployment, the amount of benefits paid and how 
long paid, and upon the expense of administra- 
tion. 

A study should be made of the extent of unem- 
ployment in the appropriate classifications cover- 
ing cyclical as well as seasonal fluctuations (five 
or seven years). If this study is impracticable 
by reason of change in classifications, lack of data 
or otherwise, a fair estimate can be made. 

APPROPRIATE CLASSES 

Unemployment insurance is practicable only for 
regular employees. 

QUALIFICATION 

Perhaps a reasonable definition of what should 
constitute qualification would be the presence on 
the railroad roster of the individuaPs name for 
during one year prior to the effective date of the 
plan. 

ENGINEERS AND CONDUCTORS 

Engineers of sufficient seniority are sure of 
reasonably continuous employment. Those of 
less seniority are demoted to firemen, when runs 



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as engineers are not available. Furthermore, 
their i>ay is usually sufficient to enable them to 
save to meet reductions in income. Unemploy- 
ment insurance would not be of sufficient benelit 
to them to warrant installing it. 

FIREMEN AND ENGINEMEN 

Firemen and enginemen are appropriate for 
unemployment insurance. Practically thirty per 
cent of those rostered are now laid off. 

SHOP TRADES 

Unemployment insurance appropriate. 

SWITCHMEN 

Switchmen are subjected to the vicissitudes of 
traffic variation. Unemployment insurance is ap- 
propriate. A study of the duration and fre- 
quency of their unemployment is desirable. 

CLERKS, ETC. 

The seniority rule is here applied and stability 
of employment fairly well maintained. The em- 
ployees laid off are in considerable part young 
men or women without families. In the main 
they have not devoted their lives to the railroad 
service as a career. The employment of station 
agents is substantially constant. Freight han- 
dlers and truckers include casual labor but some 
of this class do perform technical railroad work 
as, for example, weighers and checkei*s. Foremen 
are laid off to some extent and should be pro- 
tected. A study should be made of this class; al- 
so of maintenance of way employees. 



Signalmen's work is fairly continuous, as is 
also that of Train Dispatchers and Telegraphers, 

RISK INSURED AGAINST 

The risk is unemployment not arising from 
fault of the insured or from old age, sickness or 
accident. These risks should be covered sepa- 
rately. Dismissal for just cause is not covered. 
Disputes thereon are determined by the Railroad 
Labor Board. 

Strikes prior to conference on disputes or prior 
to decision of the Labor Board if referred are 
unlawful. Non-compliance with the Board's de- 
cision by either party may also be unlawful. Un- 
der this state of the law a strike contrary to the 
Board's decision should not be regarded as a 
happening of the risk insured against. A strike 
in aid of this Board's decision is a risk insured 
against— the Board itself would be the proper 
agency to decide these questions. In England 
they are decided by an agreed upon umpire and 
the unions have not been adverse to such pro- 
visions, when thus safeguarded. 

If men cause the risk insured against to hap- 
pen by their own wrongful acts, the benefit does 
not accrue. Participation in a strike declared 
improper by the Labor Board should have the ef- 
fect only of declaring that the risk insured against 
has not happened. If and when the striking em- 
ployees are accepted when they offer to return 
to work all their rights revive. 

Amount of Benefit is one-half the normal earn- 
ings of the employees, payable weekly. 

Duratian of Benefits — usually a maximum of 
fifteen weeks for any one separation from the ac- 
customed work. 



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CHECKS AGAINST ABUSE 

Unemployment insurance is payable only if the 
insured is unable to obtain employment. If em- 
ployment is available in his accustomed occupa- 
tion at his normal wage and within reasonable 
distance of his home, he must accept it. 

The decision of such questions is difficult and 
delicate. Hence it is expedient that they shall be 
made bv the workmen's own associates who are 
in touch with him and who have an interest in 
safeguarding the fund. The agency which best 
satisfies these requirements is the organization of 
which the employee is a member. If not a mem- 
ber of any organization special provision would 
have to be made. 

CONTRIBUTORS 

As both parties benefit, it is reasonable that the 
contributions should be shared. Equality of con- 
tribution seems equitable. The men would be 
financially unable to carry it alone and if the com- 
pany bore the entire burden there would be less 
incentive to the men to prevent abuses. 

ADMINISTIUTION 

In England, the employer within the Unem- 
ployment Insurance Act buys insurance stamps 
from the Government to the value of the joint 
weekly contribution and deducts one-half the cost 
from the workman's pay. The stamps are placed 
in the identification book of each workman with 
dates. The book must be presented when appli- 
cation is made to the Government employment 
officers by whom the benefits are paid. 



The administration of a railroad unemploy- 
ment insurance fund should be conducted by a 
joint committee on which the employees and com- 
pany have equal representation. 

Payment of allowances could be made by com- 
pany disbursing officers upon presentation of 
identification book and application duly counter- 
signed by the pro])er agent of the joint commit- 
tee, due provision for reimbursement to the com- 
pany from the fund having been provided for. 

Uniformity of Premimm. Seniority regulates 
practically all branches of the railroad service. 
The youngest in service is laid otf first and the 
oldest taken back first. Hence the risk is inverse 
to the length of service. The premium might be 
in due relation to the risk. In such case, the 
premium for the young in service will be pro- 
portionately heavy and might be so heavy as to 
make it unbearable. Kelating the premium to the 
length of service is probably im])racticable. It 
involves complicated records and tends to defeat 
the basis of insurance, the pooling of risks. It 
would appear necessary that the premium be ab- 
solute for all employees in the siime class of serv- 
ice. The value of the insurance to any class would 
depend upon the experience of that class as to the 
extent of lay-offs and upon the average age in 
service. The insurance should, of course, be op- 
tional. Each man may then estimate its ad- 
vantage for himself. Unless three-fourths of the 
members of a craft or class elect it, it is proba- 
bly impracticable. 



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SCOPE 



It seems impracticable to insure all railroad 
employees against unemployment. Some classes 
do not need it. Others, such as casual laborers, 
are too irregular and floating in character to be 
practicable subjects. In many classes the ad- 
vantage to the individuals is variable on account 
of the seniority rule. Hence, it is necessary to 
limit it to those classes who are particularly ex- 
posed to fluctuations in employment for reasons 
other than seasonal or weather conditions and 
classes a majority of which the seniority rule does 
not adequately protect, as a practicable plan can 
be worked out only as to such classes. Among 
possible classes the shop crafts would seem to be 
lirst as to appropriateness. Their lay-offs are fre- 
quent and cut-deep. 

ESTIMATE OF COST 

In a number of industries the cost is about 1% 
per cent, of the payroll. On this basis, assuming 
average earnings of $150 per month for journey- 
men in the shop crafts, it would cost each man 
fl.12 per month and the company the same * 
amount. 

LIFE^ HEALTH AND ACCIDENT INSURANCE 

The Delaware & Hudson Railroad Company 
has put in effect a plan for the above named in- 
surance for its employees so far as they remain 
such together with insurance against discharge to 
the maximum value of |90 described in the fol- 
lowing letter: 



31 

"From: The President. 
"To : All Employees. 
Subject : Insurance. 



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"1. The Delaware & Hudson Company 
has entered into a contract with the Metro- 
politan Life Insurance Company by which 
it has insured the lives of all employees 
who have been continuously on its payrolls 
for more than two years, and who are ac- 
tually and actively in its service on or after 
this date, securing for each employee hav- 
ing such minimum length of service, ir- 
respective of the nature of his work,' his 
age, or the state of his health, and without 
cost to himself, a policy payable at death 
in the sum of $500. 

"2. In case of total and permanent dis- 
ability, the sum of |500 will be paid to the 
insured employee in monthly instalments. 
In case of death, payments will be made 
immediately to the beneficiary named by 
such policy. The contract also permits 
groups of employees who wish to do so, to 
take additional insurance without medical 
examination and without reference to age, 
at the exceedingly low rates herein set 
forth. 

"3. To all such employees, who have 
been continuously in its service two years 
or more, wishing such additional life in- 
surance, or protection against sickness or 
accident, the company makes the following 
offer: 

« 

"Tirst: If any group of emplovees 
take, under this plan, more than $500 ad- 
ditional life and total disability insur- 
ance, for each member, the company will 
pay the balance of the monthly premiums 
above the amount stated below, on such 









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additional insurance in excess of .foOO. 
A group, under this plan, must consist, 
under the life insurance law, of not less 
than three-fourths of the employees in 
any class; application therefor must be 
made before March 81, 1922; no em- 
ployee can be insured for more than 
|5,000, nor for more than the multiple of 
$200 nearest his average compensation 
for the preceding two years. A group 
may consist of employees of the same 
class; as for example locomotive engi- 
neers, station agents, boilermakers, etc.; 
or it may consist of those employed at 
the same place or within the same area. 
" X^nder this ])lan every employee with 
two years length of service receives foOO 
life and total disability insurance with- 
out cost. By co-operation with a suffi- 
cient numl>er in his class, and the aid of 
the Company, he can have a total of 
$1,000 for' 60c per month, 

2,000 for .fl.20 per month, 

8,000 for fl.80 per month, 

4,000 for 12.40 per month, or 

5,000 for $8.00 per month, 
subject to the maximum limit above in- 
dicated. The cost in excess of these 
amounts will be paid by the company. 

" *Not only is the full amount of each 
policy payable to the beneficiary in case 
of death, but it is also payable in case of 
permanent, total disability, whether from 
accident or sickness. In case of total 
and permanent disability, the Life In- 
surance Company undertakes to pay the 
full amount of the policy in sixty (60) 
monthly instalments beginning within 
not more than six months. 

" * Second : A policy covering loss of 
work by sickness is i)rovided for, under 



33 



which the benefits are at the rate of $15 
per week for a period of twenty-six (2G) 
weeks, beginning with the eighth day of 
incapacity. The premium on this insur- 
ance is $1.26 per month, or $15.12 per 
year, and must be borne entirely by the 
policy holder. A certificate will be is- 
sued upon application, before March 31, 
1922, by any group such as previously 
described. 

" ^Third : A policy covering loss of 
w^ork by accident, exclusive of injury 
covered by workmen^s compensation 
laws, is provided under which benefits 
are at the rate of $15 per week for a 
period of twenty-six (26) weeks, begin- 
ning with the eighth day of incapacity. 
The premium for this insurance is 24c. 
per month, or $2.88 per year, to be paid 
by employees. Employees under sixty 
years of age may also obtain accident 
insurance covering death or dismember- 
ment from any actual cause, including ac- 
cidents covered by workmen's compensa- 
tion laws, at the rate of $4.00 per $1,000, 
to be paid by employees, the total of such 
insurance not to exceed the amount of 
life insurance carried under the plan. 
These offers are similarlv conditioned 
upon application for such insurance be- 
ing made before March 81, 1922, by 
group, such as previously described. 

" TouRTH : The company will under- 
take directly to insure employees against 
unemployment resulting from dismissal 
from any cause, providing payments of 
$15 (employees whose average annual 
wages during the preceding two years do 
not exceed $1,000 will be paid Vo per 
week for the same period) per week for 



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six weeks, or for so much of that time as 
a discharge employee may be unable to 
find employment, conditioned upon such 
employee having subscribed for and con- 
tributed toward the cost of at least two 
of the three forms of insurance provided 
under the group plan, as above outlined. 
" ^This provision for unemployment 
insurance is prompted by the desire of 
the company to provide continued em- 
ployment under conditions as favorable 
as possible, to promote greater ease in 
the conditions of employment by freeing 
the employees from anxiety, and to se- 
cure and maintain the most highly suc- 
cessful operation of the property, which 
is obtainable only through interested co- 
operation. 

" ^FiFTH : The company proposes to 
continue its present system of pensions, 
under which, in its discretion, pensions 
are granted to employees who have been 
in service of the company twenty-five 
years or more, and who have reached the 
age of seventy, or who, upon reaching 
the ^ge of sixty-five, are incapacitated 
for service, and under which a monthly 
sum to be paid to the pensioned employee 
is determined to equal to one per cent of 
the average monthly earnings of the em- 
ployee during his preceding ten years' 
service, multiplied by the number of 
years of service with the company.' 
"Those employees who have not been in 
the service of The Delaware & Hudson 
Company the full two years, up to the date 
of this announcement, will be included in 
this insurance plan, and entitled to all the 
benefits hereof, including the $500 life and 
total disability insurance provided, with- 
out any expense to them, as soon as they 



have completed two years of continuous 
service. 

"Employees leaving the ^service of the 
Company for any reason will be able, upon 
notice to the Life Insurance Company with- 
in thirty days, to excharige their certifi- 
cates without medical examination for pol- 
icies in the same amount, but will there- 
after pay the regular rate for the ages at 
which such new insurance is subject to. 

"Employees who have been with the 
Company as long as six months, but not for 
two years, will receive identical life and 
disability insurance, without expense to 
them, in the sum of |250 and may take not 
more than $250 additional, in groups at a 
monthly cost to them of eighteen cents. On 
attaining two years of service, such em- 
ployees will automatically become entitled 
to all the benefits of the plan. 

"The within plan and offer are wholly 
voluntary on the part of the Delaware & 
Hudson Company, which reserves the right 
to cancel, withdraw, discontinue or modify 
the plan and these offers, at any time and 
at its option. In case of the discontinu- 
ance of the plan, the Life Insurance Com- 
pany undertakes to issue to any employee 
requesting the same, provided individual 
application therefor is made within thirtv- 
one days of the date of such discontinu- 
ance, a new policy or policies, upon plans 
applicable to the character of the risk, in 
equal amount or amounts, without medical 
examination, but at the ordinarv rate 
chargeable in respect to such amounts of 
insurance at the then age of such insured 
person." 



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COMMENTS ON D. & H. PLAN 

The "unemployment insurance'' so-called of 
the Delaware & Hudson is against dismissal and 
does not cover lay-offs. It therefore affords no 
protection against the risk which most troubles 
railroad employees. 

The plan becomes effective as to any class of 
employees, except as to $500 life policy, only when 
three-fourths of the members of any class, as, for 
example, boilermakers, car men, etc., accept the 
offer. 

It is understood that this plan was promulgated 
without conference with the employees concerned. 
Information from the railroad and insurance 
companies is to the effect that the plan has been 
accepted by the necessary number of a large per- 
centage of the groups. It is believed, however, 
that the plan would have been a more effective 
agency for promoting co-operation had it grown 
out of conferences with the representatives of the 
employees concerned. 

The cost of the insurance over the |500 free 
policy is understood to be paid entirely by the em- 
ployees through the deduction of the necessary 
amounts from their pay, as follows: Additional 
life $500, 60c. per month; further additional life, 
Gc. per month for each |100 over the first $1,000 
Health Insurance: Sick benefits, 16c. per week, 
$1.26 x>^r month; Accident Insurance $15 per 
week, 24c. per month. Accidental death and dis- 
memberment insurance, equal to total life insur- 
ance 33c. per month for each $1,000. The so- 
called unemployment insurance specified is free of 
cost to the employee upon condition that lie sub- 



37 

scribes to at least two of the three classes of in- 
surance provided. Probably it was added to 
destroy the argument against participation to the 
effect that an employee discharged would lose his 
paid-in premiums. The approximate cost to the 
railroad company of the insurance for which it 
pays (except unemployment) is from one to one 
and one-half per cent, of the total amount of in- 
surance. 

INSURANCE BY OTHER COMPANIES 

A number of railroad companies insure their 
employees. The Union Pacific, for example, in- 
sures at its expense in varying amounts every 
employee receiving $4,000 per year or less against 
death, sickness and injury. 

OTHER MEANS OP PROMOTING CO-OPERA- 

TIVE SPIRIT 

The executive officers of railroads can do much 
to promote co-operation by adopting a policy of 
consideration and by maintaining personal con- 
tact with employees. Evidence of a desire to- 
gether with an effort to establish a friendly re- 
lationshi]) has effect. Outside the railroad field, 
the American Telegraph and Telephone Com- 
pany, among many others, has achieved good re- 
sults largely through this method of furthering 
co-operation. 

TRAINING OF FOREMEN 

As the attitude of the foremen is of enormous 
importance in the application of co-operative 
principles, means of improving his technique in 
this field should be alluded to. The foreman re- 
flects to the rank and file of workers the attitude 



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of the company. A number of industrial com- 
panies have established courses in the art of 
handling men for foremen. 

PROMOTION OP SAFETY OP EMPLOYEES AS 
MEANS TOWARD CO-OPERATIVE SPIRIT 

Many railroads have established Safety Com- 
mittees (Central, divisional, local, shop and term- 
inal) composed of employees and officials. These 
committees initiate, consider and recommend pro- 
posals looking to the elimination of risks to em- 
ployees and the public in railroad operation. The 
Northwestern established such committees in 
1912. Since that date, to March, 1922, they have 
made 56,20G recommendations, of which all but 
2,475 were put into effect. The members of the 
committees are appointed by railroad officers. 

PENSION PUNDS 

A number of railroads maintain pension funds. 
In general the employees' organizations regard 
them as instruments designed to drive a wedge 
between the workman and his organization by 
binding him in interest to his employment and 
thus reduce the striking power of his union. The 
organizations have succeeded in breaking down 
compulsory contributions by emj^loyees. What 
pension funds now exist are maintained either by 
contributions of the company or such contribu- 
tions supplemented by voluntary contributions of 
individual employees. The Railroad Brother- 
hoods maintain "Beneficiary Departments" pro- 
viding benefits in case of disability or old age. 



39 



CONFERENCE ON THIS SUBJECT ADVISABLE 

Conference between representatives of railroad 
companies maintaining pension funds and or- 
ganizations also maintaining such funds might be 
able to work out a plan whereby both parties 
would contribute to a joint fund available for the 
same uses, thus increasing the benefits and de- 
• creasing the expenses. 

The diversity in interest between the parties 
might be met by appropriate provisions. The 
employees naturally wish to be able to strike 
without losing their benefits. A fair provision 
would be that the custodian of the fund should 
return premiums paid by the company during a 
specified period, say six months, in case of a 
strike, the question of its justice to be decided by 
an agreed umpire. Of course the company would 
not pay premiums to the fund for the period an 
unjustifiable strike lasted, but the strike should 
have no effect upon the rights of employees other- 
wise qualified for pensions. 

THE PRESENT A PAVORABLE TIME POR IN- 
STITUTING CO-OPERATIVE MACHINERY 

The war and events since the treaty of Ver- 
sailles must have convinced reasonable men that 
combat and a peace imposed and sanctioned by 
force brings woe alike to victor and vanquished. 
Industrial war and armed truce carry like evils 
in their train. The Washington Conference suc- 
ceeded because it substituted the ascertainment 
of mutuality of interest by free and equal repre- 
sentatives and an agreement by consent for co- 
ercion. In many branches of industry co-opera- 






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tion has taken the place of war throu?j;h agree- 
ments to stabilize employment, promote joint in- 
terest and increase production entered into be- 
tween representatives of the managements and 
of the employees. The railroad industry pos- 
sesses factors peculiarly qualifying it for co- 
operative action. Railroad employees constitute 
a highly intelligent and disciplined body of men. 
They are well organized and trained in the tech- 
nique of democracy. Several of their organiza- 
tions carry on complicated enterprises as well as 
govern themselves. Their leaders have construc- 
tive ability and are in general moderate and re- 
sponsible and are aware of the essentials for busi- 
ness success. These organizations, if given an 
incentive to aid railroad productivity, would 
bring into action force of enormous power and 
value now suppressed. 

RECOMMENDATIONS 

1. A management desirous of promoting the co- 
operative spirit should determine with what 
classes of employees it is judicious to begin. The 
shop crafts are recommended as affording the 
best opportunity. The subject should then be 
discussed informally through a representative 
with the general officers of the shop crafts or- 
ganizations, upon the basis of this or a re^^sed 
memorandum. If the general officers approve the 
subject should then be taken up with the system 
representative and an agreement reached as to 
the scope and provisions of the plan. 

2. A particular officer of the railroad should 
be charged with the responsibility of handling the 
development of the plan and of studying and sub- 



41 



mitting available methods of co-operation to the 
proper officer. Without such responsibility and 
particular care, the plan suggested would proba- 
bly not succeed. It is a delicate matter to intro- 
duce and gear up new machinery with old. Many 
adjustments are necessary. They should be made 
by a hand and mind friendly to the plan. 

Many large industries provide in their plans of 
organization for personnel managers. It is the 
function of these officers to promote personnel 
productivity. Among other methods of accom- 
plishing this these officers endeavor in all intelli- 
gent ways to promote the development of the co- 
operative spirit. On railroads this function is 
imposed upon operating officers who are over- 
burdened with mechanical problems. Therefore 
it is in general neglected. Qualified personnel 
managers doubtless would be valuable to most 
railroads. 

In any event it should be made the duty of some 
railroad officer free from all other duties to de- 
velop means of co-operation, submit them to the 
president or board of directors and put them in 
effect to the extent and in the manner the pres- 
ident and directors may determine. To him should 
be committed the duty of developing the plan of 
conferences on co-operation outlined in the fore- 
going memorandum. 



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42 



APPENDIX 

TENTATIVE PLAN FOR SHOP CO^DVIITTEE 

American Railroad Company, Lincx)ln Shops 

Aims. The manaj^jenient of the American Rail- 
road Company and the workmen of the Lincoln 
Shops recognize that both parties would be bene- 
fited by — 

1. A better understanding by the management 
of the needs, desires and problems of workmen 
and by workmen of the objects and problems of 
the management. 

2. The stabilization of the shop forces, the re- 
duction of unemplo3'ment to a minimum and the 
improvement of team work. 

3. The establishment of confidence in each 
party of the friendly intentions and considerate- 
ness of the other, so that a spirit of co-operation 
may come into being and bring about good rela- 
tions between management and workmen. 

4. Ascertainment of and agreement upon a 
fair output. 

5. The increase of productiAity. 

G. Elimination of causes of discontent. 

Mcmu. Management and workmen alike be- 
lieving in the principle of representation, in each 
other's fairness and intelligence, and that the 
foregoing and other joint interests can best be 



43 

ascertained and furthered and diversities of in- 
terest ascertained and settled by conference of 
representatives of the parties, hereby establish 
accordingly this plan of regular conference 
through a joint shop committee. 

Jurisdiction. The joint committee shall con- 
sider and endeavor to agree upon methods of 
furthering the foregoing joint interests. It may 
consider among other means to those ends the 
following : 

1. Elimination of waste in materials or the 
wage appropriation. 

2. Improved co-ordination between the several 
departments of the shop. 

3. Proper scheduling of work through the shop. 

4. Proper storage and care of material. 

5. Adequate supply of hand tools and their 
maintenance in proper condition. 

C. Better grouping of machine tools. 

7. Better machine operation and crane service. 

8. Improvement of processes. 

9. Improvement in classification of repairs. 

10. Improvement in methods of handling and 
disposing of scrap. 

11. Better inspection of scrap and reclamation 
of useful material. 

12. Improvement of shop and grounds from the 
standpoint of health and comfort. 



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13. Promotion of safety. 

14. Plans whereby a part, of the value of pro- 
ductivity above an agreed minimum will be paid 
into an unemployment insurance or other insur- 
ance fund or otherwise disposed of to joint ad- 
vantage. 

15. The establishment of life, health, accident 
and unemployment insurance. 

Committees. The joint shop committee shall 
have power to establish appropriate sub-com- 
mittees, determine their jurisdiction, the method 
of selecting their members, and their procedure. 

General Provisions. 1. As the respons-ibility 
for economic operation of the railroad is imposed 
by law on the management, final decisions on pro- 
posals affecting such operation remains with the 
management but no proposals made by the com- 
mittee will be arbitrarily denied. 

2. There shall be no discrimination in the 
operation of the plan as between union and non- 
union workmen. 

Representatives of hhnplofjees — How to he 
Choseii. All workmen employed in the following 
crafts or occupations shall be entitled to elect 
three representatives for each craft or occupa- 
tion, each craft or occupation holding a separate 
election. The said crafts or occupations shall be 
the following: (Here set out occupations deter- 
mined upon.) 

The election shall be by ballot similar to that 



45 

provided by the Railroad Labor Board in the 
Pennsylvania dispute of 1921. 

Representatives of Manac/ement—How Chosen. 
The shop superintendent and foremen, heads of 
departments shall be company members of the 
joint committee. The shop superintendent shall 
be entitled to appoint such additional members of 
tlie joint committee to represent the management 
as will make the total number of company repre- 
sentatives equal the number of employee repre- 
sentatives. 

Times of Meeting. Meetings shall be regular 
or special. The regular meetings shall be monthly 
and shall be held a reasonable time prior to the 
day on which the shop superintendent has been 
accustomed to put into effect his plan of opera- 
tion of the shop for the ensuing month. 

Prior to each meeting, the superintendent shall 
provide each member of the committee with a 
statement of the condition of the appropriation 
for the shop together with an estimate of the work 
to be accomplished on such appropriation and the 
pro])osed method of doing the work. 

Officers and Procedure. The officers of the 
committee and its order of business shall be de- 
termined by the committee. 

Appeals from Decision of Superintendent. Xo 
proposal adopted shall take effect unless the 
shop superintendent concurs. Appeal from the 
adverse decision of the shop superintendent may 
be provided for as agreed by the joint committee 



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with the concurring!: vote of the shop 8iij)erin- 
tendent. 

Amendments. The committee may at any reg- 
ular meeting adopt proposals for amendments by 
majority vote of the members and with the con- 
curring vote of the shop superintendent. Such 
proposal shall be submitted to the membership of 
the crafts and occupations, parties to the agree- 
ment for vote by ballot and shall go into effect 
if adopted, as provided by the proposal. 












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COLUMBIA UNIVERSITY LIBRARIES 

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between railroad managements and 
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